Income Tax Calculator (New Regime)
Calculate income tax under the New Tax Regime for FY 2025-26. 7-slab structure with rebate up to 12 lakh.
Accurate income tax estimation with new tax regime slabs, Standard Deduction, 87A Rebate, and instant Old vs New Regime comparison for FY 2025-26.
Income Details
Default ₹75,000 for New Regime · ₹50,000 used for Old Regime comparison.
Ready to Estimate
Enter your monthly or annual income to get a full tax breakdown with Old vs New Regime comparison, donut chart, and animated slab table.
Income Tax Guide FY 2025-26
New Regime Rules & Updates
1. New Tax Regime Highlights
- Standard Deduction: Increased to ₹75,000.
- Tax-Free Limit: Income up to ₹12.75 Lakhs is effectively tax-free due to the increased rebate limit.
- Rebate 87A: Maximum rebate increased to ₹60,000 for taxable income up to ₹12 Lakhs.
2. Revised Tax Slabs (Budget 2025)
| Income Range | Tax Rate |
|---|---|
| ₹0 - ₹4L | Nil |
| ₹4L - ₹8L | 5% |
| ₹8L - ₹12L | 10% |
| ₹12L - ₹16L | 15% |
| ₹16L - ₹20L | 20% |
| ₹20L - ₹24L | 25% |
| Above ₹24L | 30% |
Common Questions
Is New Regime better for everyone?
For most people earning under ₹15 Lakhs, the New Regime is significantly better due to lower rates and the 87A rebate. However, if you have HRA + Home Loan + 80C deductions exceeding ₹4 Lakhs, the Old Regime might still save you money.
What is the zero tax limit?
With the Standard Deduction of ₹75,000 and the 87A rebate up to ₹12 Lakhs taxable income, you effectively pay zero tax if your gross salary is up to ₹12.75 Lakhs.
Income Tax Calculator Guide (New Regime): FY 2025–26 (AY 2026–27) with Budget 2025 Changes
The Income Tax Calculator for the New Tax Regime (Section 115BAC) helps salaried government employees and private sector workers quickly estimate annual tax liability, monthly TDS deductions, and net in-hand income for FY 2025–26 (AY 2026–27). This guide explains the new slab rates, standard deductions, and how to use the calculator effectively.
1. What is the New Tax Regime (Section 115BAC)?
The New Tax Regime is a simplified income tax system introduced to reduce tax burden through lower slab rates and wider brackets. From FY 2025–26 onwards, it has become the default regime for most taxpayers, though individuals can still opt for the old regime if beneficial.
Key Features of New Tax Regime:
- Lower Tax Rates: Slab rates reduced progressively (0% up to ₹4 lakh, then 5%, 10%, 15%, etc.).
- Unified Slabs: Same slabs apply to all taxpayers regardless of age.
- Fewer Deductions: Most deductions (80C, 80D, HRA, home loan interest) are NOT allowed in new regime.
- Standard Deduction Available: Salaried individuals get standard deduction of ₹75,000 (new regime) or ₹50,000 (old regime).
- Section 87A Rebate: Complete tax rebate for taxable income up to ₹12 lakh (new regime) or ₹5 lakh (old regime).
- Simpler Compliance: Fewer deduction proofs and documentation required.
✓ New Regime Advantage: For most salaried individuals earning up to ₹25 lakh annually, the new regime offers 10-15% lower tax compared to the old regime.
2. Income Tax Slabs – FY 2025–26 (New Regime)
Budget 2025 increased the basic exemption limit to ₹4 lakh and introduced flexible slabs.
| Taxable Income (After Standard Deduction) | Tax Rate | Amount (on income in this slab) |
|---|---|---|
| Up to ₹4,00,000 | Nil | ₹0 |
| ₹4,00,001 – ₹8,00,000 | 5% | Max ₹20,000 (on ₹4L) |
| ₹8,00,001 – ₹12,00,000 | 10% | Max ₹40,000 (on ₹4L) |
| ₹12,00,001 – ₹16,00,000 | 15% | Max ₹60,000 (on ₹4L) |
| ₹16,00,001 – ₹20,00,000 | 20% | Max ₹80,000 (on ₹4L) |
| ₹20,00,001 – ₹24,00,000 | 25% | Max ₹100,000 (on ₹4L) |
| Above ₹24,00,000 | 30% | 30% of excess above ₹24L |
Note: Health & Education Cess (4%) applies on total tax. Surcharge applies for income above ₹50 lakh.
3. Standard Deduction and Rebate (Section 87A) – UPDATED FY 2025–26
Even under the new regime, salaried employees and pensioners get deductions and tax relief.
Standard Deduction: ₹75,000 (New Regime) | ₹50,000 (Old Regime)
- New Regime Amount: ₹75,000 deduction from salary/pension income for FY 2025–26.
- Old Regime Amount: ₹50,000 deduction from salary/pension income for FY 2025–26.
- Who Gets It: All salaried individuals and pensioners (no conditions).
- Automatic Benefit: No documents needed; it's automatically allowed in the calculator.
Section 87A Rebate – Enhanced in FY 2025–26
New Tax Regime (Major Improvement!):
- Maximum Rebate: ₹60,000 (increased from ₹25,000)
- Applicable Limit: For taxable income up to ₹12,00,000
- Effective Benefit: Salaried employees with gross salary up to ₹12.75 lakh pay ZERO tax.
Old Tax Regime (Unchanged):
- Maximum Rebate: ₹12,500
- Applicable Limit: For taxable income up to ₹5,00,000
4. New Regime vs Old Regime – Comparison (UPDATED)
| Feature | New Regime (FY 2025–26) | Old Regime (FY 2025–26) |
|---|---|---|
| Slab Rates | Lower (0%, 5%, 10%, 15%, 20%, 25%, 30%) | Higher (10%, 20%, 30%) |
| Standard Deduction | ₹75,000 ✅ | ₹50,000 |
| Section 80C Deductions | NOT allowed | Allowed (up to ₹1.5 lakh) |
| HRA Deduction | NOT allowed | Allowed (50%/40%/25% of salary) |
| Home Loan Interest | NOT allowed | Allowed (up to ₹2 lakh) |
| Section 87A Rebate | ₹60,000 (up to ₹12L) ✅ | ₹12,500 (up to ₹5L) |
| Best For | Most salaried employees | High deduction claimers, self-employed |
💡 Recommendation: For salaried government employees: New regime is typically ₹15,000–₹50,000 more beneficial because lower rates and higher standard deduction outweigh loss of HRA deduction.
5. Worked Examples – FY 2025–26 (UPDATED)
Example 1: Monthly ₹50,000 Salary
- Annual gross salary: ₹6,00,000 | Less std deduction: ₹75,000
- Taxable income: ₹5,25,000
- ₹4L – ₹5.25L @ 5% = ₹6,250 | 87A Rebate (taxable ≤ ₹12L): −₹6,250
- Total tax: ₹0 | Monthly TDS: ₹0
Example 2: Annual ₹18,00,000 Salary
- Annual income: ₹18,00,000 | Less std deduction: ₹75,000
- Taxable income: ₹17,25,000
- Slab tax: ₹20,000 + ₹40,000 + ₹60,000 + ₹25,000 = ₹1,45,000 | Cess: ₹5,800
- Total tax: ₹1,50,800 | Effective rate: 8.4% | Monthly TDS: ~₹12,567
Example 3: Zero Tax Case (87A Rebate)
- Monthly ₹40,000 → Annual ₹4,80,000 | Less std deduction: ₹75,000
- Taxable income: ₹4,05,000
- Tax: ₹250 | Cess: ₹10 → Total: ₹260 | 87A Rebate: ₹260
- FINAL TAX = ₹0 (ZERO TAX!)
6. Monthly TDS Calculation
TDS (Tax Deducted at Source) is the monthly tax your employer deducts from your salary.
Formula: Monthly TDS = Annual Tax ÷ 12 months
- HR calculates your estimated annual tax and divides by 12 for monthly TDS.
- Year-end: If TDS exceeds actual tax, you get a refund.
Example: Annual tax ₹60,000 → Monthly TDS ≈ ₹5,000
7. Deductions NOT Allowed in New Regime
| Deduction | Limit (Old Regime) | New Regime |
|---|---|---|
| 80C (PPF, Insurance, LIC) | ₹1.5 lakh | NOT Allowed |
| 80D (Medical Insurance) | ₹25,000–₹1L | NOT Allowed |
| HRA Deduction | 50% of salary (X-class) | NOT Allowed |
| Home Loan Interest | ₹2 lakh | NOT Allowed |
✓ Exception: Standard Deduction (₹75,000 new regime) IS allowed. This is the ONLY major deduction.
8. How to Use the Calculator
- Enter Salary: Monthly or annual (auto-converts). Include basic + DA + all allowances.
- Select Age: Below 60 / 60–80 / Above 80 (unified rates in new regime).
- Standard Deduction: Default ₹75,000 (new regime) — adjust only for special circumstances.
- Click Calculate: Get full breakdown including Old vs New Regime comparison, donut chart, and animated slab table.
9. Frequently Asked Questions (UPDATED)
Q: Is new regime default from FY 2025–26?
A: Yes. From FY 2025–26 onwards, the new tax regime is the default for all individual taxpayers. You can still opt for old regime if you find it more beneficial.
Q: What is the zero tax income limit for FY 2025–26?
A: ₹12.75 lakh gross salary (new regime): Gross ₹12,75,000 → Less std ded ₹75,000 → Taxable ₹12,00,000 → Tax ₹60,000 → 87A Rebate ₹60,000 → Net tax ₹0.
Q: What's the standard deduction for new regime?
A: ₹75,000 (New Regime) | ₹50,000 (Old Regime) for FY 2025–26.
Q: Section 87A Rebate limit?
A: ₹60,000 maximum (up to ₹12L taxable income) for new regime. Old regime: ₹12,500 (up to ₹5L).
Q: Can I claim HRA in new regime?
A: No. HRA is NOT allowed in new regime. This is an advantage of old regime for X-class city employees.
Q: When will I get my income tax refund?
A: After filing your ITR by July 31, refunds are typically credited within 3–6 months. Track status on the IT department's website.
Q: How do I know if old or new regime is better for me?
A: Use the comparison section in this calculator — it auto-computes both regimes instantly after you enter your income.
Disclaimer & Data Sources
This calculator and guide are based on the FY 2025–26 Income Tax Act, Budget 2025 notifications, and official Government of India tax announcements as of January 2026. Income tax laws and slab rates are subject to change with each budget. The calculations are for informational and estimation purposes only. For official tax confirmation, ITR filing, or complex cases, consult a Chartered Accountant or tax professional.
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